"It does appear to be in a classic liquidation selloff because basically the market broke key technical levels and the fundamentals remain weak," he said. "Some of the longs who jumped into the market when the market went from $42 to $62, decided to turn on their positions."
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Worries that Greece would hurt Europe's economy—and oil demand—were one of the catalysts for Monday's selling. Another big factor is the view that Iran could reach an agreement with the U.S. and five other nations on its nuclear program. If that were to happen, Iran could unleash more crude onto the market.
There was also concern that China's economy could slow further as the Chinese government attempts to stem the selloff in its stock market.
Oil had been trapped in a band between $57 and $62 per barrel since late April. It broke out of that when developments in the talks with Iran appeared to improve.
On Nymex, CFTC positioning data showed that while traders trimmed longs in crude futures and options, those positions still outnumbered shorts in WTI by about 4-to-1 last week.
Analysts said the longs could add more pressure as they bail out, and next week's report should reflect a further decline.
CFTC weekly data for Nymex and ICE showed the net number of long positions in West Texas Intermediate futures and options at 212,318, a decline of 25,955, the lowest since early April, according to John Kilduff of Again Capital.
He also said there was a slight increase in shorts. "Obviously the momentum's swinging back to the shorts," said Kilduff, who expects to see further declines.
Kilduff expects it to fall to the $49-per-barrel level in the short run. "Ultimately you're looking at the lows of March," he said.